Sezzle CEO Touts New Product Momentum and Enterprise Focus; Raises 2025 Guidance

Fresh off Tuesday’s announcement that the Consumer Financial Protection Bureau (CFPB) would not treat buy now, pay later (BNPL) companies like credit card networks, Sezzle’s first quarter 2025 results highlight a company in the midst of rapid transformation, with nonfinancial developments signaling a strategic pivot toward deeper consumer engagement and platform innovation.

The Minneapolis-based BNPL provider rolled out several new features this quarter, including a Pay-in-5 beta program, enhanced shopping tools such as price comparison, wish lists, and auto-applied coupons, as well as the Money IQ financial education module.

These initiatives are designed to personalize the shopping experience, boost user retention, and reinforce Sezzle’s positioning as a purpose-driven FinTech platform. The company also expanded its merchant network, signing on notable partners like Scheels and Whomp It, and strengthened its online communities to foster customer loyalty and financial literacy.

On the financial front, Sezzle posted standout results on Wednesday (May 7). Gross merchandise volume (GMV) surged 64.1% year over year to $808.7 million, fueled by increased subscriber and on-demand user engagement. Total revenue climbed 123.3% to $104.9 million, marking a new quarterly high, while net income more than quadrupled to $36.2 million, or $1.00 per diluted share.

Operating efficiency improved, with total operating expenses dropping to 52.4% of revenue — an 18.2-point improvement from the prior year. Consumer purchase frequency rose sharply to 6.1 times per year, up from 4.5, reflecting stronger engagement and higher lifetime value per user.

Despite a typical seasonal decline in monthly On Demand and subscribers to 658,000 from 707,000 in Q4, the company’s raised guidance, boosting its 2025 net income forecast by nearly 50% to $120 million, underscores management’s confidence in sustaining momentum.

Sezzle’s robust cash position ($120.9 million in cash and equivalents) and ongoing investments in innovation and user experience position the company for continued growth in the competitive BNPL landscape.

During the Q&A, CEO Charlie Youakim highlighted Sezzle’s push toward enterprise-level merchants, noting, “We tend to focus more towards enterprise-level merchants now, although we do have a mid-size funnel as well … but it is definitely a focus towards the larger side of the equation.” He also pointed to new verticals, such as grocery, where BNPL adoption has lagged, as areas of recent traction.

Youakim addressed the company’s On Demand product, reporting “monthly sequential growth right now, which tells you we’ve got a really a winner of a product on that.” He explained that On Demand’s lower barrier to entry is bringing more consumers into the funnel, with gross margin per user comparable to Sezzle’s premium subscription. This cross-sell opportunity is helping drive engagement and conversion to higher-value products.

On credit quality, Youakim emphasized a balanced approach: “We know our profitability levels are a lot stronger year over year … so if you know that your top line’s at a higher level, you can accept a little bit of a higher cost to still hit the same gross margin.

“But trust me, we’re not trying to just open up to grow volumes. We think about it in terms of ROI and on terms of maintaining gross margins that we like to maintain.” Despite a first-quarter loss rate below expectations, Sezzle is maintaining its 2.5-3% annual loss guidance.

Product innovation remains central, with Youakim describing the Pay-in-5 beta and auto-applied coupon features as direct responses to customer demand and loyalty drivers. “The results were really surprisingly positive. … We’re pretty happy with the results thus far,” he said of Pay-in-5, which now accounts for under 10% of volume but is expected to grow.